Posts Tagged ‘supermarkets’

Last week Tokyo Shimbun reported that an industry association of food producers sent letters to supermarket chains and other food retailers saying that they had reached their limit of patience. This particular association represents companies that produce moyashi, or bean sprouts, a pretty lowly item, even within the realm of produce, and one that is not strictly agricultural in nature.

Though bean sprouts definitely qualify as vegetables, almost all Japanese producers import the basic ingredient, which is mung beans (ryokuto or midori mame), and then make them sprout in factories. In other words, no land cultivation is involved. Bean sprout production is a ridiculously simple process, since all it entails is making the mung beans wet, setting them aside for a few days to sprout, and then packaging them.

The moyashi association is saying that production costs have become untenable, which sounds strange considering how easy the process is, but what they’re really talking about is the cost of mung beans, 80 percent of which are imported from China, mainly Jilin Province, where farmers are switching over to corn because the price of animal feed has gone up and they can make more money. Consequently, the market price for mung beans has also gone up, by as much as 30 percent since a year ago.

The average household is seeing tighter food budgets thanks to worldwide rise in the prices of basic commodities. And while these price rises will curb deflation, they won’t have much of an effect on the downward pressure that deflation has put on wages. So while food prices will go up, your paycheck will remain the same.

Get stuffed

Still, supermarkets and other food retailers will likely try to keep their prices as low as possible for competitive purposes. And since everyone is doing that, marketing chiefs have to come up with ways to get you into their stores in the first place. Traditionally, supermarkets put on shows: They buy a huge, expensive tuna and have some knife expert come in and slice it up in a grand, flamboyant way. The housewives love it, and while they’re there they buy other stuff. With penny-pinching in vogue like never before, loss-leader type events are more attractive. Loss leaders are products or product lines that are sold below cost mainly for promotional purposes. The style of promotion that’s become most prominent in recent years at food stores is tsume-hodai.

Tsumeru means “to stuff,” and hodai means “as much as you want.” In tsume-hodai sales, the retailer offers selected wares, usually produce, in bulk. Customers stuff bags provided by the retailer with as much of a given product as they can fit into them and then pay a set low price for each filled bag. Some years ago when the idea was first launched, it was usually only low-priced vegetables that were offered, like potatoes or onions. Eventually, vegetables were joined by fruit, then fish, and even sometimes meat. Last weekend we saw a tsume-hodai table set up on the street outside a discount supermarket offering pastries and other baked goods. Given the enthusiasm with which the housewives were stuffing the pastries into their plastic bags we assumed by the time they got home they would be filled with sweet, doughy mush.

Some supermarkets have actually become famous for their regular tsume-hodai fairs, which typically attract evening news crews who like nothing better than the spectacle of middle-aged women pushing and shoving and cramming. The fad’s apex, however, is represented by outlets of the convenience store chain Lawson that feature Kobe Hotto Deli, a buffet of prepared food. Instead of throwing unsold food away, KHD offers its own brand of tsume hodai: You take a tray of cooked rice and top it with as many dishes as possible for the uniform price of ¥390, which is usually what a dish would cost individually. The only condition is that the lid has to fit snugly over it. No leaning towers of fried prawns.

Deflation is a drag on the economy since it keeps wages low and depresses demand, but most consumers like it for reasons that aren’t difficult to comprehend. The recent spike in the value of the yen should also translate as savings at the cash register, certainly in terms of imported goods, but the lag time is difficult to gauge and, in any case, it seems a lot of importers and wholesalers just refuse to pass the savings on to the public. As reported in this space earlier, imported cheese should be cheaper, but it hasn’t really changed at all for years, supposedly because it’s considered something of a “luxury,” which means . . . what? Cheese importers have some sort of right to gouge Japanese cheese lovers?

In any case, starting Aug. 16, several nationwide supermarket chains are marking down select items on their shelves because of the high yen. Ito-Yokado, with 161 stores throughout Japan, is discounting at least 20 items a day from 10 percent to 50 percent. Many of the items are packaged goods (Crystal Geyser water, ¥78 for 500 ml) but some are agricultural products (South African grapefruit, ¥88), which is good news considering how expensive fresh produce has been this summer. The Jusco chain (300 stores), which belongs to Aeon, will offer more than 50 items at discount, including salmon from Chile (¥178 for 100 grams) and American broccoli (100 grams for ¥88), with different items being added or taken from the list on a day-to-day basis. Ito-Yokado’s program ends Aug. 22, and Jusco says that its discount plan will continue “until at least Aug. 22.” As for other big chains, Daiei says it it considering doing the same, and Seiyu has no plan to get on the bandwagon.

In Japanese, the term yutosei, or “honors student,” has a wide range of usage that can go beyond the animate. For instance, in the food retail business, eggs and milk are often referred to as “excellent pupils” in that they’ve maintained a stable price over time.

Eggs in particular. Between 1955 and around 1980, the price of 10 eggs (about a kilogram) fluctuated between ¥200 and ¥350. By the bubble years of the late 80s the price had stablized back to around ¥200 and has essentially stayed there ever since, which means that it costs about the same to buy an egg now as it did to buy one in the lean years after the war, when an egg almost qualified as a luxury food item.

Consequently, eggs have always held a certain iconic position in the Japanese diet, and lately have been used by supermarkets and other food retailers as loss leaders or medama shohin, meaning merchandise that are advertised at ridiculously low prices in order to draw customers into a store where they will presumably buy other products. The Price, Ito Yokado’s chain of discount supermarkets, last week was advertising packages of 10 eggs for only ¥99, and I saw a piece on TV Tokyo’s Business New Satellite that mentioned a supermarket that was selling them for ¥88.